The Bank of Russia decided to revoke since March 5, 2009 banking licenses from Municipal Commercial Bank and South Trade Bank, the PR department of the Central Bank of Russia said in a press release.
Kaliningrad-based Municipal Commercial Bank was stripped of its license because of the failure to comply with laws regulating banking activities and CBR statutory acts, identified instances of submitting unreliable financial reports, the inability to meet monetary claims of creditors or fulfill the duty of making mandatory payments. South Trade Bank (Rostov-on-Don) saw its license cancelled as it was unable to meet monetary claims of its creditors. Due to the loss of liquidity it failed to take measures to make settlements under clients’ accounts on time.
In line with the CBR order temporary administrations began work at the banks until bankruptcy managers or receivers are appointed in line with the Federal Law “On Insolvency (Bankruptcy) of Lending Institutions”. The powers and authority of the banks’ executive bodies were suspended.
Both lending institutions are members of the national deposit insurance system. The cancellation of a lender’s banking license is an accident insured, as provided for by the Federal Law “On Insuring Private Deposits Held with Banks in the Russian Federation”.
